The following information was taken from the financial statements of Finn Resources Inc. for December 31 of the current fiscal year;
Common stock, $20 par value (no change during the year) $5,000,000
Preferred stock $10 Stock, $40 par (no change during the year) $800,000
The net income was $600,000 and the declared dividends on the common stock were $125,000 for the current year. The market price of the common stock is $20 per share.
For the common stock determine (a) the earnings per share, (b) the price earnings ratio, (c) the dividends per share, and (d) the dividend yield. Round to one decimal place except earnings per share, which should be rounded to two decimal places.
Your tutorial (attached in Excel) shows you the key to finding the number of shares and then helps you to solve for the needed ratios. Computations are in the cells in Excel.